A note on board characteristics, ownership structure and default risk in Taiwan

Shu Mei Chiang, Huimin Chung, Chien Ming Huang

Research output: Contribution to journalArticlepeer-review

10 Scopus citations


This study applies dynamic generalized method of moments estimation to examine the influences of ownership structure and board characteristics on default risk for a full samples and two subsamples (high-tech and conventional) of publicly listed firms in Taiwan. Our findings reveal that certain characteristics of corporate governance have explanatory power for default probability, but the impact is not straightforward. In particular, the impact of internal and external governance structures on default risk is industry dependent. Accordingly, governance proposals that encourage higher ownership among directors and large block shareholdings in high-tech firms or reduce managerial ownership in conventional companies can have a counterproductive effect on corporate governance and result in higher bankruptcy possibility.

Original languageEnglish
Pages (from-to)57-74
Number of pages18
JournalAccounting and Finance
Issue number1
StatePublished - 1 Mar 2015


  • Board characteristics
  • Corporate governance
  • Default risk
  • Kealhofer, McQuown and Vasicek model
  • Ownership structure

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